Nikolas Sargeant
Senator Bill Hagerty, a Republican from Tennessee, has introduced a new bill aimed at regulating stablecoin issuers in the U.S., marking the Senate's latest move on cryptocurrency oversight. Under the leadership of crypto-friendly Republicans, the bill seeks to establish a comprehensive regulatory framework for dollar-pegged stablecoins, including the designation of federal and state regulators for different types of issuers.
Hagerty, who led stablecoin efforts in the previous congressional session, has the backing of Senate Banking Committee Chairman Tim Scott and Cynthia Lummis, head of the digital assets subcommittee. This is a stark contrast to the previous Congress, where stablecoin legislation failed to progress due to opposition from former committee chair Sherrod Brown, a Democrat, who was ousted by a p`ro-crypto rival in last November’s elections.
The proposed bill, dubbed the GENIUS Act (Guiding and Establishing National Innovation in U.S. Stablecoins), aims to provide clarity on the issuance and regulation of stablecoins. Under the bill, large stablecoin issuers would be overseen by the Federal Reserve for banks and the Office of the Comptroller of the Currency (OCC) for nonbank issuers with more than $10 billion in assets. Smaller issuers would fall under state regulators, a point of contention in past legislative efforts. However, the bill also provides flexibility for larger firms to seek waivers, offering a potential path for compromise.
While Hagerty's bill is expected to attract bipartisan interest, it remains unclear whether it will garner Democratic support due to its lighter regulatory approach compared to earlier proposals. The bill's introduction comes after the House of Representatives passed a stablecoin oversight bill in the previous session, but the Senate struggled to pass a matching version. Hagerty’s latest attempt is seen as a fresh push to establish U.S. stablecoin regulations in the new Congress.
Stablecoins, such as Tether (USDT) and Circle’s USDC, are cryptocurrency tokens designed to maintain a stable value by being pegged to assets like the U.S. dollar. As the global stablecoin market continues to grow, the introduction of this bill signals that the U.S. government is taking steps to ensure proper oversight of these digital assets. Hagerty’s stablecoin initiative will likely be discussed further as part of the broader crypto strategy outlined by President Donald Trump's newly appointed crypto czar, David Sacks, in a press conference later this week.
